Private equity firm backs PR tool platform Cision in $2.74 billion deal
PR end-to-end tool platform attracts private equity investment but is five years away from widespread industry adoption.
Cision is set to be acquired by an affiliate of private equity firm Platinum Equity in a cash deal valued at $2.74 billion.
The offer of $10 per share is a premium of around a fifth on Cision’s current share price. It has fallen from a high of $15 in November 2018.
Cision’s Q2 revenue was up 1.6% at $190.5 million. Customer subscriptions increased by 2.5% year-on-year to 46,340. Average revenue per customer is $11,510. It’s a relatively low number for an end-to-end software platform.
The transaction is expected to close in the first quarter of 2020. It is subject to approval by Cision shareholders.
Building a PR tool platform
A report published last week called Martech: 2020 and Beyond published by BDO, WARC, and the University of Bristol, estimates that worldwide marketing technology is $121.5 billion.
It reported that 22% of companies are starting to embrace a platform provided by a primary vendor such as Cision over a suite from best in breed vendors. 48% use a primary vendor along with specialist providers.
Cision has made more than $1bn of acquisitions in the past five years in a bid to develop cloud based platform for the communications and public relations industry.
September 2014 - Visible Technologies, social media analytics company
October 2014 - Vocus , media relations database and engagement tools
June 2016 – Gorkana, media database
December 2015 – PRNewswire, press release distribution
December 2017 – PRIME Research, research and insights
It has also recruited a management team from the enterprise software industry including Oracle veteran Kevin Akeroyd as CEO.
Meeting Cision CEO Kevin Akeroyd
I got the chance to meet Akeroyd at Cision’s CommsCon conference in London last November.
Communications is the last remaining department within the enterprise that is ripe for disruption according to Akeroyd.
“Every other operational area in the enterprise has been through this transition. Marketing, sales and finance have all been modernised by technology and software as a service. We’ve got communications in our sights,” he said.
The Cision Cloud platform includes listening, influencer identification, content planning, channel distribution and measurement.
Cision’s media attribution model provides a means of quantative digital measurement but requires a cookie to be dropped on an earned media website.
“We’re not getting any pushback from publishers or influencers. We’re currently tracking 95% of earned media outlets. Ad tech has been working in this way for more than a decade,” said Akeroyd.
“Changing the behaviour of public relations practitioners is our biggest challenge,” he said.
Adoption of integrated PR platform is a five year project
I’ve learned from projects such as #AIinPR and #PRstack that workflow in the public relations business is typically built on point products strung together with Excel and Word documents. Change is slow.
“It will take time for communications to modernise but not as long as sales or marketing. Organisations have already been through the cycle of disruption,” said Akeroyd.
“What previously took 15 to 20 years is going to take five years this time round,” he said.
Cision’s Akeroyd claims that earned media has never been so important and yet never less underserved by investment by organisations.
